Vanessa Lazo was an amazing high school student and so it was no great surprise when she was accepted into


Question:

Vanessa Lazo was an amazing high school student and so it was no great surprise when she was accepted into Prestige Private University (PPU). To entice Vanessa to attend PPU, the school offered her a reduced tuition of $13,000 per year (full-time tuition would typically be $43,000 per year). PPU also has a scholarship program to a large donation from William Gatos. Vanessa was the Gatos Scholarship winner and will receive a scholarship for $20,000. Vanessa is required to use the scholarship first to pay her $13,000 tuition and the remainder is to cover room and board at PPU. Lastly, PPU also offered Vanessa a part-time job on the PPU campus as a student lab assistant in the Biology Department of PPU for which she is paid $1,500. You are the Lazo’s CPA and they have requested you write them a letter explaining how much of this package will be taxable to Vanessa each year. Make sure your letter is professional and properly references Publication 970.

 


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